Schaumburg attorney accused of bilking clients

October 02, 2013|By Robert McCoppin, Chicago Tribune reporter

Tribune illustration of handcuffs (Tribune illustration)

Regulators have accused a Schaumburg attorney and former prosecutor of taking hundreds of thousands of dollars for his own use from several clients, including an elderly man, a 5-year-old girl and the lawyer's own aunt and uncle.

Two complaints by the Attorney Registration and Disciplinary Commission accuse Lino John Menconi of forging signatures and converting client funds to pay for personal items that an ARDC official said included credit card bills, property taxes, children's activities and entertainment.

"Clearly, the evidence shows a long-standing pattern of fraud," commission attorney Robert Verrando told the ARDC's hearing board, according to a transcript of the hearing.

The agency's administrator recommended as a result of the first complaint that Menconi be disbarred, while the commission's hearing board instead recommended a three-year suspension. The outcome is pending before the Illinois Supreme Court.

Menconi's attorney admitted that Menconi mishandled some of his clients' funds but denied he engaged in fraud. Attorney Samuel Manella argued that much of the money Menconi received was due to him as attorney fees, that he didn't take the amounts alleged and that he had long since repaid his clients' disputed funds, according to the hearing transcripts.

Menconi has not been charged with a crime. He could not be reached for comment.

In the first complaint, filed in December 2011, the ARDC hearing board concluded that Menconi, who previously worked as an assistant Illinois attorney general, improperly converted more than $460,000 from four clients for his personal use.

The more recent complaint, filed on July 18, alleged Menconi misappropriated funds totally more than $180,000 from three separate clients.

In one case, Menconi recovered $112,000 from an investment company on behalf of an 86-year-old client. But instead of telling the client he'd secured the money, Menconi is accused of pocketing at least $101,000 for himself, the commission charged.

In another case, the commission alleged that, in 2011, Menconi represented a 5-year-old girl who had been injured by the door of a coin-operated laundry machine in Chicago. Regulators said Menconi kept the entire $65,000 settlement in that case after "falsely" telling the girl's mother multiple times, including as recently as this May, that he had not yet received the settlement funds, according to the complaint.

In 2012, Menconi won a judgment to collect $21,000 on behalf of another client in a contract dispute in Cook County. Regulators said he put more than $15,000 to his own use, while again telling his client he had not received the payment.

Menconi, 48, who practices law in Schaumburg and lives in Bloomingdale, had not filed a response to the more recent allegations as of Wednesday.

In the complaint already pending in front of the Supreme Court, the ARDC alleges that Menconi settled a claim with a client's former employer for $247,000 but converted $190,000 of that to his own use in 2007.

Subsequently, regulators said Menconi represented a 67-year-old aunt after she was injured in an automobile accident. The complaint states that Menconi in 2007 won a settlement of about $325,000 — about $100,000 of which was supposed to go to a hospital that treated his aunt — but that he converted the entire amount to pay his own personal or business expenses. She died soon after from cancer.

Similarly, regulators charged, beginning in 2009, Menconi represented his uncle, who was 71 and living in a nursing home at the time and died the following year. The ARDC alleged he took $125,000 from the uncle and his estate.

Verrando, the ARDC attorney, argued at the hearing that Menconi did not repay all his victims and that the money he did return was repaid only after his clients realized what had happened and came using proceeds from later alleged victims. Verrando also noted that courts have ruled attorneys are not entitled to legal fees for settlements made without the consent of their clients.

Verrando also charged that Menconi repeatedly lied to the ARDC about the cases in question and created a fake promissory note purported to be from his uncle to cover his tracks. In at least two cases, the ARDC also alleged that Menconi signed his clients' names and the name of a notary on different legal documents related to their cases.

In his defense, Menconi testified at the disciplinary hearing earlier this year that he paid for his aunt's and uncle's expenses and that he had consent to sign his aunt's and uncle's names to documents. Since being admitted to practice law in 1991, he said, he's done free legal work for his old school and for some clients and has worked as a youth sports coach. But Menconi admitted to cutting corners, such as depositing money into his own account rather than a client's account, and said "certainly ... I've gotten into trouble" by representing friends and family members.